China officially banned ICOs - People's Bank of China issues formal notice
China has officially banned all ICO (Initial Coin Offerings) in a recent report by the People's Bank of China. This didn't come as a surprise as the government has already leaked some warnings and rumors have been spreading regarding this issue. However, this was the worst possible outcome as some Chinese platforms were still optimistic that there would only be limitations instead of a direct ban. ICO platforms like ICOage and ICOINFO have already suspended operations prior to this announcement. In addition, the notice warned people about the dangers of investing in cryptocurrencies and stated directly that cryptocurrencies are not legal currencies in China. Cryptocurrencies are regarded as commodities in China and cannot be used in place of the government currency, the Ren Min Bi (RMB).
Too Fast too Furious?
ICOs in China has gained a lot of traction in recent months due to the rising interest in blockchain technology and the potential to make large gains from sold-out ICOs. This has lead to more than 300 ICOs going online in China, a lot of which was hastily put together. Some suspicion also fell on a few ICOs where leaders were accused of insider trading or faking the contribution amount. The government intervention in this field is most likely a response to the possible rise in the number of illegitimate ICOs.
ICO Refund ?
Cause 2 of the article asked for "individuals who have completed the financing of the tokens should make arrangements for repatriation and so on". Currently, platforms such as ICOinfo are contacting project owners of ICOs that have NOT yet distributed tokens for a refund. It is unknown what will happen to projects that have already been sold on the market. Although it would make little sense refund tokens that are worth more than the initial ICO value.
[Note analysis of this event is still ongoing and updates will be added to this post]
Also published on my webite, boxmining.com http://boxmining.com/china-banned-icos/
It is obvious that ICOs became an easy vehicle for money laundry in the case of China, a huge powerful rich country with heavy gov control, of course it was going to call the attention.
Regulations are just part of the path of evolution in this lands, but the NEO drop is just a market manipulation. The money in China is not gonna disappear and crypto economy is not gonna vanish either, NEO is still a very good proposal, and the big interest probably want a piece of the profit.
It is easy to take a China governmental confrontation with the subject (ICO/Crypto/BTC) and link it to the flag company that is skyrocketing, this drop might be the opportunity for some to buy at a super cheap price and wait for the now slower process to get at the level of Ethereum, aka, a price around and above 100 bucks.
Thank you for your work, I really enjoy your blog. Cheers!
Just goes to show, China and USA aren't all that different. Governments just want power and they want to control the masses by any means necessary. This is a perfectly example of why decentralization is important and this is also why you can never have nice things.
but how will you protect people from investing into scams ?
Very right. Well-said! China and US aren't all that different. All governments want power and control the masses! But nothing can hold blockchain technology-decentralization back.
The Chinese government always do things with a long term view. A ban now only means a more orderly rise in the future. there are just too many mediaore ICOs out there now and everyone just jumping on board hoping to get rich. I would say the earlier ICOs were quality ICOs but now those up and coming ones are in it just to rake in the money because they saw the outcome to those before them.
Far too much FUD. The headlines cause mass fear for no reason. People need to read the titles correctly. This is ICO's - a lot of which have no product and development. Everyone is simply dumping their money in a white paper that aims to never deliver. This is a positive step. Let us fund projects that aim to improve the world and actually work like IOTA. Guys, this is not bad news. Read between the lines!
I'm having the exact same thought: this is not bad news actually
Good times to buy Neo :)
Is this just the beginning?
Could they change their mind?
Probably just if they can control it better.
I guess this will have negative impact on Ethereum price,but now for long,because nothing can stop ETH for gaining new highs
Good news in my opinion because the prices have decreased and we can make nice profits by buying now and selling later!
Rule of thumb. Buy everything China forbids. Worked for me with bitcoin.